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IRS' Mr. Spock asked, 'What were you thinking?'

| Friday, June 7, 2013, 12:30 a.m.

WASHINGTON — An Internal Revenue Service official whose division staged a lavish $4.1 million training conference and who starred as Mr. Spock in a “Star Trek” parody shown at the 2010 California gathering conceded to Congress on Thursday that taxpayer dollars were wasted.

“In hindsight, many of the expenses that were incurred should have been more closely scrutinized or not have been incurred at all,” Faris Fink, commissioner of the tax-collection agency's small business and self-employed division, told a congressional committee.

Fink, a top deputy in the department that flew 2,600 managers to Anaheim, Calif., for three days in 2010, described a culture that did not blink at what the Treasury Department's inspector general called excessive spending. But the 32-year employee — who was promoted the next year — said the IRS is “now in a very different environment. ... We would not hold this same type of meeting today,” Fink told the House Committee on Oversight and Government Reform.

Fink sat stoically as TV screens in the hearing room showed excerpts of the nearly six-minute video in which he and other IRS employees wore “Star Trek” uniforms on a set resembling the bridge of the Enterprise and Fink sported pointy ears.

“It's embarrassing and I apologize,” he said.

When asked by committee Chairman Darrell Issa (R-Calif.), “What were you thinking?” when Fink stayed in a luxury suite and played Spock in the video about a planet with ineffective auditing practices, Fink called the spoof “an attempt, in a well-intentioned way, to use humor to open the conference.”

For helping organize the conference, Fink and five other managers took home a total of $6,000 in bonuses.

The committee is investigating $49 million in conference spending by the agency from fiscal 2010 to 2012, with a particular focus on Anaheim. Lawmakers disclosed an email showing that two top managers placed on administrative leave this week took $1,162 in free food from an outside event planner, and took pains to hide the gift.

“It is to be kept confidential,” Jill Mirich, an employee of the Anaheim Hilton, told her colleagues, referring to an after-hours party the managers held for 18 employees in their private suites.

“The beer and wine will be paid by a credit card given to you at the end of the function by Mr. Donald Toda or Fred Schindler,” Mirich wrote on Aug. 21, 2010. “Do not post to room it can't be shown as room charge.” The last sentence is underlined for emphasis.

The mea culpa by Fink was echoed by new acting IRS chief Danny Werfel as the embattled agency struggled to contain public and congressional ire over its targeting of conservative groups seeking tax-exempt status.

Werfel called the gathering in Anaheim “an unfortunate vestige from a prior era” and said IRS spending on travel and training has fallen 80 percent since then.

“Our work in this area is one part of a much larger effort to chart a path forward in the IRS. This is obviously a very challenging time for the agency,” Werfel said.

Fink insisted that his agency followed federal guidelines in planning the Anaheim conference. He said the conference was justified because at the time, 30 percent of its managers were new and the agency was confronting increased security threats.

Sitting at the same witness table was J. Russell George, the Treasury inspector general whose scathing reports on the IRS' targeting of conservatives and conference spending have rocked the agency. George said he uncovered no criminal violations involving the conference.

That didn't shield Fink endured a three-hour tongue-lashing from the panel.

Issa called the spending for the California conference “at best maliciously self-indulgent.”

Top panel Democrat Elijah Cummings of Maryland said he was kept up during the night trying to discover why the “Star Trek” parody was even made. “I tried to get to the redeeming value,” Cummings said. “Can't get there.”

Rep. Carolyn Maloney, D-N.Y., called the video “an insult to the memory of ‘Star Trek.' ”

Fink was grilled repeatedly by Republicans to explain how he could have signed off on the conference without objecting to a cost first estimated at $4.3 million.

“Did you believe you were entitled to this?” Rep. Jason Chaffetz (R-Utah) asked. Fink replied that the conference itself was not wrong, since up to a third of the managers being trained were new.

Chaffetz began to yell. “You have a public trust, and you're paid by the American taxpayers to be responsible. And you're saying it was a pretty good conference?”

George's report concluded that rather than saving money by negotiating lower room rates with the three Anaheim hotels, the IRS paid a standard government rate of $135 per room but accepted perks, such as some tickets to Los Angeles Angels baseball games, in return. Asked why the IRS didn't negotiate for lower room rates, Fink said, “I was not aware we had the ability to do that.”

Cummings read another e-mail sent by an employee of the Anaheim Marriott to a colleague that showed the IRS could have booked the conference in Florida for $1 million less.

“Orlando and Las Vegas are out!” the e-mail began. “This is fantastic news, as Orlando was $1 million less in travel spend. The funding is there and they have been instructed to move forward [in Anaheim].”

The report found the IRS used two private event planners whose commissions were based on the hotel bills and therefore had no incentive to save money; spent $50,000 on the “Star Trek” spoof and another showing IRS employees line dancing; and paid $135,000 to 15 outside speakers.

The conference included two dozen workshops, including one led by IRS officials titled, “Political Savvy: How Not to Shoot Yourself in the Foot.”

Meanwhile, Werfel said he would encourage IRS official Lois Lerner to appear before the Oversight committee. Lerner, who headed the IRS unit that targeted Tea Party and other conservative groups, cited her constitutional right against self-incrimination when she declined to answer questions from the committee last month, though she also proclaimed her innocence.

The Washington Post and Associated Press contributed to this report.

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